Journey to debt free-dom

bindi_soup

Hi Folks

I've been in debt for about 12 years, everythng is and has been paid on time but as ive just bought my first house they are now less of an annoyance and more of a problem - things are getting tight, and if im not careful i can see myself falling in to real difficulties very soon. I run out of money early in the month, and then any debts ive cleared or money ive saved i have to break into to get to the next payday. And ive been doing this for years...

I know my problem - Im a spendaholic. I go shopping every day for something, doesn't matter if its a loaf of bread or shoes or whatever, and when i look at my bank statement i can see what im doing, but its a hard habit to break. So... i thought id sart a diary, to really bring into focus (and keep my focus) on NOT spending, and really tackling once and for all these debts. Be interest to hear from anyone who has been similar and how they managed to break the cycle..
I have some financial goals i want acheive, but first, where i am at the moment:

Overdraft : £350 (banks just called this in, now sure where im going to get it from. Can they do that? I've only had 2 weeks notice, would they let me do it by installments?)
Loan settlement: £1060.90
Virgin card : £4750
Barclaycard : £1969.40
Total : £8130.80

I have recently paid off most of my loan with a credit card to get it on to 0% interest, and I think im going to cash withdraw £1000 from the barclaycard and use that to pay off my loan (the loan is crippling me at £186.99 a month). But not going to do that until i have another balance transfer card at the ready to get on to 0% interest.

I will keep paying the minimums for now, and save up what i can sperately, to hopefully pay off in big lumps (but still leaving the funds available for emergencies - I've learnt from experience that enthusiastically overpaying and leaving yourself short only leads to more trouble). I've worked out my outgoings and think i can realistically save at least £150 - if i stop my needless wasting. It scares me how much hard earned cash i literally burn through, with nothing to show for it.:(

Targets:
6/7 months left to the end of the year - i'd like to get £1000 off the total, anything under 7000 would be really good result i think.
By end of 2015 - 4000 (or less?!) would be amazing. But lets just see how this year goes first.
A general mental u turn to my attitude towards money. I guess this would be gradual process and not something that happens overnight.

Long term - 3 month worth of bills in the bank. About 3K.
Long long term - As much saved as i owed at my worst 11K (HA! Well, i can dream...):rotfl:

Oops this post is a bit longer that i intended, oh well, it actually feels really good have have written it all down! Step one complete. Step 2 may be a little trickier. First things first. Draw out in cash my budget for groceries, and stick to it. I think it might help if i can SEE my budget, and im quite sure that alot of cash gets wasted in this area alone. So many tempting offers in supermarkets... maybe its time i visited aldi or lidl - which is better? is the stuff ok?

Thanks for reading! if anyone has any tips or gems of advice, im all ears!!

[Deleted User]

bindi_soup wrote: »

and I think I'm going to cash withdraw £1000 from the Barclaycard and use that to pay off my loan (the loan is crippling me at £186.99 a month).

Wouldn't you be better off, using some of it, to pay off the withdrawn overdraft?

scorpio2

Morning all
Just joined MS expert.and also took the plunge to ring and speak to "Stepchange" DMP. best thing I have ever done, like the advert says on tv I can now sleep at night. Anyone thinking about it..then go ahead,they are not there to bite your head off or criticise you, they are really! there to help you. I wish I had taken them on board 12 mnths ago instead of trying to continually struggling to make CC payments.My husband is very poorly and everything was a great worry.we even put our house up for sale (that was before I spoke to stepchange) as I was jumping before I was pushed so to speak. We have now taken the house off the market thankfully as it was just making my husband worse.The creditors have been fine apart from
Barclays & Halifax who refused the offer from stepchange, I don't know why. as these are the smallest debts we have, Barclays being around £600 and Halifax around £900. I had never ever missed a payment and paid right up to the month prior to contacting stepechange.The easiest and most approachable ones have been
M &S, Natwest,Tesco,Mbna.who have all been really nice and helpful, Nationwide made a bit of a fuss..but so far things ticking over.It will take us 6yrs to be debt free...although my Husband will not live this long to see it..as when I am on my own I have no idea what money etc I shall have coming in, as I have cared for him for over 20yrs with various illness, he is 20 yrs older than myself.but just wanted to tell people.. there is hope, there is light at the end of that very dark tunnel.there are! people to help you,just pick up that phone, or email or write...just do it..;)

bindi_soup

bedsit bob - yes you're probably right, i might have to. Trying avoid that though as i REALLY want out of this loan asap. Doing that would reduce my repayments from £294.00 (186.99 + 40 + 50 + 50p a day for the overdraft - down to £50 + £60 + £14 = £124, which give me a lot more breathing room, and a real shot at sorting them out. Any other suggestions on options? I get a small bonus from work at the end of July, which woud cover it, but the bank want theirs back by the 8th June. And no, work won't give it to me in advance!

Scorpio2 that sounds like really sound advice. I don't think im at that point yet, its not out of hand - I'll try taking active control of the situation and see how i get on. It all works out on paper at least!

After reading through a lot of post,s it seems that people make it into a sort of game? Little challenges, things to keep the motivation... i really like this idea - i love games! Especially if they're steps towards a better debt free future :-)

[Deleted User]

If you paid off the £350 overdraft, and put the remaining £650 toward the loan, you would have less than 3 months left on the loan.

Allowing for a bit of interest back (or a slight overpayment), you could probably clear the loan in July.

chiefsfanuk

bindi_soup wrote: »

After reading through a lot of post,s it seems that people make it into a sort of game? Little challenges, things to keep the motivation... i really like this idea - i love games! Especially if they're steps towards a better debt free future :-)

Welcome Bindi!

When reading your post I did think to myself one of the NSD (no spend day) challenges would be good for you, have you had a look at the DFW Challenges board?

bindi_soup

Not fully - will have a look now.

How do people update their signatures? I can't find it for the life of me...

bindi_soup

Well it's all gone pear shaped already... I don't get paid until Friday, and on checking my account I actually have big fat 0 left. So I've had to use my credit card for the food shop to get us through.

However. on the sunny side, I got breakfast lunch and dinners sorted for £23.40. Just for my own records, this is my menu and shopping list:
Breakfast: cereal - both
Lunches
Tuesday - me - super noodles, Apple, banana, mini flap jack, yoghurt
OH - beef pastie, apple, banana, mini flap jack yoghurt
Wednesday - leftover potatoes, salad leaves, tomatoes, red onion - Apple, banana, yoghurt, cheese dippers - both
Thursday - leftover curry, Apple banana mini flap jack
Friday - pasta/pastie, Apple banana cheese dippers

Dinners - raided freezer here:
Monday burgers in a bun, salad
Tuesday - grilled chicken, New potatoes, baked beans
Wednesday - chicken curry
Thursday - griddled lamb and pork steak, Moroccan cous cous, steamed broccoli and tomatoes
Friday - payday!

Shopping list Sainsbury:
Basic noodles 0.30
Sb cous cous 0.60
Micro pilau rice 1.00
Mugshot 0.74
Basic banana 1.15
Mini New potatoes 1.35
Basic tomatoes 0.72
Onion x1 0.15
Bread rolls 0.60
2 pt milk 0.89
1 pt milk 0.49
6 yoghurt 1.00
Laughing cow dippers x 4 1.00
Shower gel 1.50
Mini wheats 1.99
Basic meat veg pastie x 4 1.50
40 tea bags 0.70
Butter 0.90
5 mini flap jacks 1.00
6 Apple's 1.50
Broccoli head 0.69
Baked beans 0.36
Jar curry sauce 1.00
Salad bag 0.69
Red pepper 0.69
1 red onion 0.10

Mental note to self - plan a menu before I go... and source some lunch options which are cheap and vaguely healthy! This menu isn't too awful, but with a bit more planning could do better.:o

asparagus1968

hiya, just caught up with your thread.


don't you have to pay a bigger fee if you get a cash advance or pay off a loan with a credit card , be careful!


ring the bank asap re the overdraft, some will let you pay off in off in instalments, fingers crossed for you.
looking at you shopping list, some things came to mind:


sainbos basic teabags are lovely- 40 for 15p
lunches- how about making (or buying ready made ready to cook ) pastry and fill using leftovers, or a bit of cheese and onion etc, would be cheaper (and not entirely sure what goes into basic pasties...)
pasta salads?
curry powder mixed with a tin of tomatoes, cheaper than a pound a jar.
homemade flapjack, dead easy (even I can make it)
free range eggs are 6 for 95p at aldi, (£1.48 at sainsbos today) and you can do a lot with an egg!
really recommend aldi, give it a whirl.


look forward to following your progress

bindi_soup

Thanks will give those a go! Especially the curry sauce - mmm love curry...
Yeah I'm not really a fan of buying prepacked stuff if I can help it, like you say not sure what's in them and I enjoy cooking from scratch. got a bit caught out this week but Friday I can start afresh. Will check out aldi - someone said their fruit and veg is really good price and good quality.

bindi_soup

Been away for the weekend at a bike rally. It's been booked since last year, not going wasn't really an option, but I do feel guilty spending unnecessarily. I tried to keep it cheap, we took our own beer, but it's s lot of fancy dress which resulted in £100 going on credit card. Balls - I thought I'd kept it cheap, but it added up...

Again, for my records, I'm going to note down my outgoings as they stand now, with little notes to help my keep track. Feel free to comment if anything glaring jumps out!

Incoming:
My wages - 1505
OH - 530
£2035

Outgoing:
Barclaycard - 50
Virgin cc - 50
Loan - 187
Overdraft - 40
Car ins - 28.76
Water bill - 40 (change to meter?)
Mortgage - 420
Contact lenses - 27.50 (task - change to tescos, £10/month)
Tv license - 12.12
Joint life cover - 24.69
Home insurance - 22.10
Council tax - 98
British gas - 135 (can't change until August. Checked account and its overspending, but will leave alone for a minute)
Animal food for month - 53.21
Virgin media tv broadband - 35.99
Petrol in tank - 57.21
Drawn out petrol - 60
Drawn out groceries - 200
Total: £1542.22:eek:

Still to come out
Pets insurance - 18.39
Private dental - 7.05
Drainage cover - 1.00
Orange mobile - 37.36
Netflix - 5.99
Acc fee - 2.00
Total essential spend - 1614.01

Non essential spending so far:
M&s lunch on way to rally - 2.90
Costume bits hat and beads - 11
Chemist - wash kit - 15.75
Pound shop - 14.15
Sainsbury - travel bottles, loo roll, camping snacks, washing liquid - 13.85
Socks forgot to pack, bought some at services - 9
Work bonus ball 2/week - 10
Spending money for weekend - 80 (25 leftover)
Total - 156.65

100 transferred to nationwide acc for:
Isa - 10
Esavings for car - 20
Charge on overdraft - 25 (spoke to them, are going to refund )
Overdraft interest charge - 9
Left an additional 30 in acc for spare

So... by my calculations, I have 128.21, plus 30 in savings acc, plus 55 in nationwide acc. I shouldn't need to touch 128.21 - already drawn out food and petrol money. Although it's my birthday next weekend, my family have planned a surprise... hope it's cheap...

Good news! Mbna gave me a card with 3500 limit - enough to switch over barclays, so I can pay off loan. We have also had hours increased at work, so this will result in pay increase.

Actions:
- Speak to nationwide, get back charges and arrange o/d repayment schedule. DONE
- arrange balance transfer card for barclays, so can clear loan then transfer to 0%. DONE
- draw cash off Barclaycard, pay off loan
- check New mbna card has balance transferred
- book contact lenses app with tescos
- plan menu for the week, food shop under £50
- change to water meter?
- reduce cost of home/life cover? Investigate.
- set nsk challenge! 20 days - DONE
-

That'll probably do for a minute...